Caldwell Wealth & Estate Advisory Ltd. | The Good, the Bad and the Ugly - Caldwell Wealth & Estate Advisory Ltd.

The Good, the Bad and the Ugly

Posted by  on 
February 22, 2017
  • pexels-photo-27118

My last real blog post was in October and a lot has happened since then, to me personally and in the world. And then of course, there are the markets. So let’s look at these one at a time.

Personally, 2016 was in many ways a great year. Lots of time with grandchildren and some travel. Near the end of the year, two things happened that really defined the year for me. One good, and one not.

On the good side, we welcomed our fifth grandchild and first grandson into the family. Tyden was born on November 14. And he got to meet his Gr’aunty while she was still aware and she got to hold him for the first and last time.

On the other side was the passing of my sister (Gr’aunty). Diagnosed in early October with lung cancer, Carole also was on dialysis for kidney disease so the prognosis was not good. On December 3, Carole passed away surrounded by her siblings and nieces and nephews.

Carole fought right up until the last couple of days, but in the end she did not have the strength to continue. We spent almost two months with her, surrounding her with love, care and attention. She knew she was not alone, but she was also afraid and not ready to go. If there was a bright side, it was that she did not suffer, needed no pain medication and was coherent and aware up until the last couple of days. I think of her every day, as I know my other siblings do.

This is the circle of life. Going through it enlightens you and makes the time you have with others all the more valuable and precious.

Now to our global situation. I know that some will disagree with me, and hopefully I won’t get blasted on social media for having an opinion, but here it goes.

America has a new president. And now we, the world, have someone in power who has no political experience, spouts alternative facts, and has portrayed himself as a saviour while exhibiting misogyny, homophobia, xenophobia and just a lot of phobia.

The protests have begun. What affect will they have? People talk about these being scary times, and I agree. But I also think back to my dad and his five years fighting in Europe, I’m sure those were scary times. I also think of my granddad fighting in the Great War and experiencing scary times. I say this not to belittle what is going in today, for we are in uncharted waters. And while next 4 years will be telling, we have survived many scary times in our history.

We may not have any control over global affairs, but we do control how we react to them. So, how do we proceed?

Two things jump out for me.

First, as I have often said, one of the prime indicators of successful investing is to ensure you have the correct Strategic Asset Mix, aka SAM. (See my previous blog post).

Second, be aware that our portfolio managers continue to look for opportunities to invest in quality companies. They concentrate on the fundamentals of the companies they are buying or selling. Sometimes they may go to a heavier cash position in anticipation of an economic downturn or they may stay invested because they suspect that the downturn is short term and they have solid investments in their portfolios. Portfolio Managers are important as they are looking for quality investments no matter what the political environment is.

Here’s a quote from another sourced newsletter and one of the things they relayed to their clients: “The famous investor Benjamin Graham points out that in the short run, the market is a voting machine but in the long run, it is a weighing machine. He is telling us that short term market prices are influenced by emotional swings that are highly susceptible to the ups and downs of psychology but that long term returns are driven by fundamentals. We determine from this that market price movements may show us what investors are thinking but may not say much about how to structure investment portfolios to deal with the difference.”

At Caldwell Advisory we take a long term approach. So, in essence, we are a weighing machine.

If you want reduce your anxiety here are some recommendations: take time away from the ferocious news cycle, read a good book, take a long walk and avoid all those pop-ups on your computer telling you about the next YUGE opportunity or problem. Those that stayed invested in 2008 and 2009 enjoyed the fruits of their patience. Don’t let fear control you. Recognize it, but don’t let it determine how you react, be it to the markets or any other force.

Like the circle of life, the markets are also circular. We go through the good and the bad. But we endure when we recognize that the markets are a weighing machine in the long term, and are driven by fundamentals.

If after reading this, you have some questions, please give me a call. Let’s get together, ensure we have you in the right SAM, and that you are positioned to thrive in these strange times.



Michael's Bookshelf

Man's Search for MeaningWith all that’s going on, I want to refer you to a book I read a long time ago (and it’s not 1984, although I read that too). I encourage you to pick up a copy of Viktor Frankl’s book Man’s Search for Meaning. As I mentioned I read this several years ago and after reading it I bought a copy for each of my kids (adults) to read. Get it from or your local book shop.





Founding Partner | Financial Planner
Michael Caldwell has been helping people sort through their money issues since the early 1970s. He has a way of talking numbers that just makes sense. Combined with wry humour and a curious mind, Michael writes about current topics of interest to the clients that he works with in his practice at Caldwell Wealth & Estate Advisory.

Read Michael's full bio »

Leave a Comment

Your feedback is valuable for us. Your email will not be published.